The Tenant Farmers Association’s National Chairman Greg Bliss will be at the Lincolnshire Agricultural Machinery Manufacturers Association Show (LAMMA) at the Newark & Notts Showground on Wednesday and Thursday 21st and 22nd January with a message for all involved in the business of letting farms to think long term.
"The farming industry faces a number of challenges requiring those in the industry to have the long term security and flexibility to invest for the future to ensure that they are equal to those challenges for the public good. Adapting to climate change (and responding to Government policies attempting to mitigate it), playing a key role in securing food security, contributing to energy security and maintaining healthy and diverse land, air and water environments will not be achieved with inflexible and short term horizons" said Mr Bliss.
Over a third of agricultural land in England and Wales is farmed by tenants. However, following the deregulation of the market in farm tenancies in 1995 the average length of new tenancies has fallen to only 3 years and nine months[1] in comparison to the lifetime and three generational tenancies created prior to deregulation.
"Farm tenancies are important not just because of the size of the sector but because they offer vital opportunities for new entrants and those looking to expand without the huge capital cost involved in buying land. It is of major regret therefore that average lengths of term are so short. Even if we look just at those tenancies which include a house and buildings the average length of term is only 9 years and seven months and these cover only 7.5 percent of all lettings1", said Mr Bliss.
"As well as short lengths of term another big problem is that landlords are increasingly relying upon inflexible lease terms and with some notable exceptions, are generally not willing to invest in their holdings. In a recent case referred to the TFA from Derbyshire, and sadly not an isolated one, a tenant approached his landlord about the £100,000 investment needed in his holding to comply with the new Nitrate Vulnerable Zone regulations. Not only was the Landlord unwilling to contribute to this investment but also turned down the tenant’s request to treat any investment he made as a tenant’s improvement which would have allowed him to be compensated for the increase in the value of the holding when he comes to leave and therefore forcing him out of dairy production. This type of short-term, reactionary approach benefits no-one," said Mr Bliss.
"There is a fine balance to be struck between providing a stable long term platform for the tenant farmer and a flexible, asset management structure for the landlord. After fourteen years of deregulation we are yet to find that balance and the TFA will be seeking to work with the Country Land and Business Association, the representative organisation for landlords, to see what might be done to improve the situation".
